How to save money in the restaurant business?

wage rise

Saving money matters in every kind of business. Isn’t it a lovely satisfying feeling to pay less for something when we know we could have paid more? Wholesale food suppliers (like “Cheetah”) are a good example.

This very nice sensation is the same no matter what you get a discount for: in the smallest grocery shopping (such as buying two packs of soda for the price of one) or in big businesses such as restaurants (wholesalers that supply you with the best rates for various products). What matters the most is to get the best combination of price and quality per product.

Although restaurants can be found on every corner of the streets, it is not easy to keep them profitable. Indeed, we’ve all heard of sad stories regarding a restaurant that went bankrupt only a few months after its opening. So how can that be avoided?

The first step to take into consideration is to build a trustworthy team that will support you and will have the same goal as you: the restaurant’s success.

This team isn’t only composed of staff working in the restaurant. It is also composed of people from outside your business, such as the suppliers who will provide you with good value and the best products which will also be part of the restaurant’s success.

We live in an era where new technology is omnipresent, more specifically, mobile apps. Nowadays, many restaurants, all around the world have chosen to use digitalization to help them save time and money. Indeed, a very useful app named Cheetah is becoming more and more popular worldwide. Its success comes mainly from the fact that restaurants have been able to save time and money very fast through its use.  This app has a function of a digitized supplier. Indeed, after downloading it, you can submit your order and ask for any kind of groceries. The supplier will deliver your order to the place of your choice the very next day. Cheetah is a digital wholesaler right at your fingertips!

It combines delivery, supplier and groceries all in one.

If you’re not very accomplished with the use of mobile apps, that’s also fine. You can reach various contacts working at wholesalers and compare the price they give you on the same product. When you’ve checked the costs and the time of the delivery (of two or three different suppliers), talk to them about the lower price their competitor offered you. Make them compete between each other. Show them that you know what you’re talking about and that they have competition. This will be another way to save money without demanding too much effort from you!

After having a strong and trusting team by your side, the second tip that will definitely help you to lower your costs is to be known locally in your surrounding neighborhood. The following question then appears: how best to build a strong marketing plan without spending too much money?

Firstly, work carefully on the menu. Don’t make it too broad, it bores people and will take their concentration away. Try to make it unique and don’t forget the times we’re living in; health also has a big impact on our routine, so try to include some healthy dishes as well. Next, don’t try to attract people from all around the world from the beginning. Start with people nearby such as businesses located in your area.  Indeed, three good ideas to do so are:

–          Make an unforgettable entrance in the food and beverage (hospitality) field by organizing an opening with a tasting event. Invite all the local businesses in your street and celebrate with them the launching of your business. Show them subtly what your menu is about and socialize with them!

–          Business lunch: make a special menu for lunch with attractive prices. It will attract the local workers to come to your restaurant during their lunch break.

–          Sell some vouchers: for instance, this can be done via well-known websites. It will definitely be a win-win success: you will reduce your marketing costs and customers will enjoy significant discount (and will maybe appreciate your food even more!)

Secondly, print advertising materials (such as brochures or business cards) with the restaurant’s details on it (menu, address and telephone number should be enough). In addition, why not pay someone to stand in the street with tastings and brochures to give to the pedestrians. Another good tip regarding spreading the brochures fast and easily, is to give a pile of them to each of your workers and ask them nicely to put them in their own neighbors’ post boxes, and/or display them on notice boards in their buildings.

When your team and marketing plans are ready, the third step may sound obvious, but it is not always the case: adopt the right reflexes. By that we mean to avoid as much waste as possible.

Try not to waste food. Make sure your delivery is not too big. Only order the right quantity of food that you’ll need during the week, so you’ll avoid throwing away unnecessary supplies. It is more recommended to order a bit less and then ask your supplier to provide you with some extras than ordering too much which will result in being stuck with food that goes out of date. Throwing food away is never a nice feeling, especially knowing that people in our world still die from hunger.

Another common waste of money that is not always present in our mind is electricity. Don’t forget to switch off lights and machines before you close your restaurant.

The best way to avoid wastage is to adopt a routine and stick to it! Indeed, decide on a special routine that you can apply daily before you close up shop so you don’t forget anything on the way.

As obvious as it sounds, not everybody will have those reflexes and that could save you an enormous amount of money at the end of the year. If you pay attention to these wastages, you will definitely make a difference which will significantly reduce the restaurant’s expenses, which will result in saving you money.

Finally, let’s not forget a very important part of a restaurant’s failure or success: organization.

If you are organized, and you know how to delegate tasks to others, the pressure on you will be substantially lowered, and you will be able to look at your business objectively, and more importantly, from a clearer perspective. You will then be able to give special attention to your regular and new customers to make them feel welcome and appreciated. How? For example, by spoiling them here and there in offering them on the house starters or drinks. That’s called customer service.

If you make them feel appreciated and remembered, there will be no reason why they won’t remember you as well!

As a conclusion, restaurants represent a very complicated business to build and more importantly, a very difficult business to keep running profitably. It can rise as fast as it can drown. It is very easy to lose control of the expenses since wastage will definitely appear at some point. The secret is to keep these losses as small as possible.

With an organized and concise business plan, your restaurant can and should succeed.

Of course, another ingredient of success is to find an ambitious and talented Chef!